Tesla Resumes Search For Showroom Space In Delhi NCR

SUMMARY

Tesla is eyeing a 3,000 to 5,000 sq ft space to set up a consumer experience centre as well as a space three times larger for its delivery and service operations

Tesla is in early talks with real estate major DLF to scout places to host its showroom in India, including DLF's Avenue Mall in Delhi and Gurugram’s Cyber Hub complex

The development comes nearly eight months after Musk called off his visit to India, during which he was expected to announce an investment of $2 Bn to $3 Bn in the country

With an eye on foraying into the Indian market, Elon Musk-led electric carmaker Tesla has reportedly resumed its search for a showroom space in Delhi NCR.

Citing sources, Reuters reported that Tesla is in early talks with real estate major DLF to scout places to host its showroom in India, including DLF’s Avenue Mall in Delhi and Gurugram’s Cyber Hub complex.

As per the report, Tesla is eyeing a 3,000 to 5,000 sq ft space to set up a consumer experience centre as well as a space three times larger for its delivery and service operations. However, the Musk-led company is planning to secure an 8,000 sq ft showroom space in the Avenue Mall.

The EV maker is also in discussions with other property developers to finalise the deal. However, Tesla’s search is still “exploratory” and nothing has been finalised yet.

The development comes nearly eight months after Musk, in April, called off his visit to India. He was expected to meet Prime Minister (PM) Narendra Modi and announce an investment of $2 Bn to $3 Bn in the country to set up a manufacturing plant.

The aftermath saw the company putting its India plans on hold and lay off more than 10% of its global workforce as part of a restructuring exercise.

Tesla’s India foray has been fraught with challenges as Musk previously was lobbying the Indian government to reduce import duties, which are as high as 100%. However, the Indian government remained adamant and directed the company to set up a unit in the country to avail subsidies.

Subsequently in March 2024, the Centre updated its EV policy, which lowered the import duty on EVs for companies setting up a manufacturing plant in India with a minimum investment of INR 4,150 Cr or roughly $500 Mn.

At the heart of all this is the growing India EV market. However, the penetration of EVs in the four-wheeler segment continues to remain abysmal, which presents a big opportunity for companies like Tesla.

The development also comes at a time when Musk-led Starlink is seeking satcom licence in India. Recently, the company also came under police scrutiny in the country after its satcom devices was used by drug peddlers to smuggle contraband worth $4.25 Bn into India via sea.